WEEKLY MARKET March 10th, 2025
I hope you're all doing well! I truly appreciate your trust and support, and I love sharing market insights with you. Lately, the economic landscape has been a bit of a rollercoaster, but there's some good news hidden in all the uncertainty—especially for mortgage rates. Let’s dive in.
A Wild Week in the Economy Between fluctuating tariffs, weak job growth in February, and the Atlanta Fed’s latest GDP forecast predicting a 2.8% contraction in Q1 2025, there’s been much economic uncertainty. But here’s the silver lining—mortgage rates have improved.
In January, inflation (as measured by PCE, the Fed’s preferred metric) eased slightly. The headline rate dropped from 2.6% to 2.5%, and core inflation fell from 2.9% to 2.6%. This helped calm the markets after a disappointing CPI report, reinforcing that inflation is gradually moving in the right direction.
Mortgage Rates Are Dropping Since mid-January, the average 30-year mortgage rate has dropped by about 50 basis points, settling around 6.75%. The main driver? Investors shifting their money from stocks into bonds, a classic "risk-off" move. That’s excellent news for homebuyers and homeowners looking to refinance.
Job Market Weakness & Recession Talk February’s job numbers from ADP were shockingly low—only 77,000 new jobs, far below expectations. To complicate things, previous ADP job reports have been revised downward significantly. Meanwhile, the Atlanta Fed’s GDP model is flashing warning signs, predicting an economic contraction. While Wall Street remains more optimistic, the uncertainty is something to keep an eye on.
Rental Rates & Inventory Trends On the housing side, rental prices continue to trend downward, with a 0.4% year-over-year decline and vacancy rates rising to 6.9%. This reflects the influx of new apartment supply, a trend expected to continue throughout 2025.
As for housing inventory, active listings on Realtor.com rose 2.2% month over month in February and jumped 27.5% year over year. While that sounds like a big increase, we’re still 23% below pre-pandemic levels.
What’s Next for the Fed? The market expects no Fed rate cuts at the upcoming March 19 FOMC meeting (with a 93% probability of rates staying put). However, expectations for rate cuts in May and June are rising, which could mean more good news for mortgage rates down the line.
Final Thoughts Despite some gloomy economic headlines, mortgage rates are trending in a positive direction. If you’re thinking about buying a home or refinancing, this could be a great window of opportunity.
I always enjoy keeping you informed and would love to hear your thoughts. How do you see these trends playing out? Let’s chat in the comments!
#RealEstate #MortgageRates #HousingMarket #EconomicUpdate